World Trade Center Settlement

by STEVE BLACKISTONE On Dec 27, 2010

Firefighters, police officers and others who worked on rescue and recovery efforts after the 9/11 World Trade Center attacks have reached a settlement with New York City over health damages they reported to have suffered.

After seven years of legal action, more than 95% of those who filed claims have accepted the terms of a massive settlement agreement that will pay out at least $625 million. Individual payments will range from $3,250 to $1.8 million, based on the severity of medical conditions.

Since the 9/11 attacks, more than 10,000 Ground Zero workers have filed lawsuits contending they were injured as a result of their work. They alleged the city and approximately 140 demolition contractors hired to assist with the cleanup failed to provide adequate respiratory protection and other safeguards against injury. To enable an orderly disposition of these actions, they were consolidated into a class-action suit. A class action is a form of lawsuit in which a large group of people join together to file a claim against one or more defendants. The persons in the class must have suffered a common injury. In this case, the injuries all resulted from the same event — the aftermath of the 9/11 attacks. A court must "certify," or give approval to, the proposed class before the action can proceed, which provides some assurance that everyone who might be affected is adequately represented.

Class actions can be used for a variety of purposes. In this case, its value comes from the efficiency gained by combining a large number of individual suits into one action. We can only imagine the chaos created by a single judge having to rule in 10,000 separate cases! Further, this action assures there will be more consistent results among those who file similar claims.

Lawyers for the city's insurance company reached an agreement in March with representatives of the 9/11 workers that would have provided a minimum of $575 million in payments. However, on March 19, the federal judge who is overseeing the negotiations rejected this settlement, saying that it did not provide enough compensation to the plaintiffs and that payments to their lawyers were too big. He ordered the parties to resume negotiations.

On June 10, the parties reached a new agreement raising payouts to a minimum of $625 million and reduced fees for the plaintiffs' attorneys to 25% of the total award. The agreement also required that 95% of the workers accept the settlement. By the Nov. 16 deadline for acceptances, 95.1% had signed on.

Every responder who had filed a valid claim against the city will receive a payment of at least $3,250. All will be enrolled in a special insurance policy that pays a benefit of up to $100,000 if certain blood and respiratory cancers occur. Beyond that, the plaintiffs will receive additional compensation based on two factors — the severity of the illness claimed and the likelihood that it could be linked to work at the World Trade Center operations.

The plaintiffs are divided into four tiers. Tier 1 is for those who were not injured, but are being compensated for their fear of future injuries. They will receive only the $3,250 initial payment. The remaining tiers are for plaintiffs with medical diagnoses of varying severity. Those in Tier 2 will receive an additional payment of up to $4,250, while those in Tier 3 will receive an additional payment of up to $7,750.

Those with the most severe medical issues, such as a severe respiratory disease, solid-tumor cancer, blood cancer or lung function of less than 80% of normal, are included in Tier 4. Their compensation will be figured by a more complex process requiring additional documentation. Their final compensation will be at least $1,000 more than Tier 3 plaintiffs and could be as much as $1.8 million, according to one estimate. The bulk of the settlement funds are expected to go to Tier 4 plaintiffs.

Now that a final agreement has been approved, the process of distributing the money begins. An independent claims evaluator has been hired to evaluate each of the claim forms that have been submitted to determine how much money the claimant deserves. Any plaintiff who disagrees with this decision may appeal to a "Claims Appeal Neutral," who will decide whether the original evaluation was correct. That decision is final since all persons accepting the agreement did so with the explicit understanding that they would give up any rights of appeal to the courts.

Although there is a final settlement, it does not formally take effect until all the parties affirm it. The first checks are not expected before early 2011.

STEVE BLACKISTONE, a Firehouse® contributing editor, is a Maryland attorney who directs state and local liaison activities for an agency of the federal government. Prior to his current position, he served in a variety of posts on the staff of the U.S. House of Representatives, working both on the personal staffs of members of Congress and on congressional committees. Blackistone also is an active volunteer EMT/firefighter with the Bethesda-Chevy Chase Rescue Squad in Montgomery County, MD.